As I write this, the European Union has just announced a possible $15b aid package to Ukraine (including 8 billion euros in fresh credit). Everybody has read the headlines about Europe: record unemployment, no end in sight, and so on.
So you might be wondering just where the European Union, and its constituent nations, scraped together the money to propose aid for Ukraine.
Well, wonder no more, because the following eight events might give you an idea of where governments go to get a little extra cash.
1. In March, 2009, Ireland seized €4bn from its Pension Reserve fund in order to rescue its banks. In November 2010, the remaining savings of €2.5bn was seized to support the bailout of the rest of the country.
2. In December, 2010, Hungary told its citizens that they could either remit their private pension money to the state or lose their state pension funds (but still have to pay for it nonetheless).
3. In November, 2010, the French parliamentdecided to earmark €33bn from the national reserve pension fund FRR to reduce the short-term pension scheme deficit.
4. In early January 2011, $60 million in private retirement funds were transferred to the state's pension scheme in Bulgaria. They wanted to transfer $300 million, but were denied on their first attempt
5. In the Spring of 2013 Cyprus took it a step further and outright confiscated up to 50% of the funds from bank account holders in that country.
6. In the Fall of 2013 the Polish government announced it would transfer to the state (aka. confiscate) the bulk of assets owned by the country's private pension funds (many of them owned by such foreign firms as PIMCO parent Allianz, AXA, Generali, ING and Aviva), without offering any compensation.
7. In February 2014, Italian banks were ordered by the Italian government to withhold a 20% tax on all inbound wire transfers. Il Sole reported, "the deductions will be automatic (unless prior request for exclusion), and then it will be up to the taxpayer to prove that the money is not in the nature of compensation 'income.'"
8. The savings of all 500 million Europeans can be stolen by the European Union. Why? Because the financial crisis is not over, according to an EU document. The Commission is looking to ask the bloc's insurance watchdog in the second half of 2014 for advice on how to draft a law "to mobilize more personal pension savings for long-term financing," the document said.
We’ve said for many years now that the US government and almost all Western governments are bankrupt. This means they will try to confiscate as much wealth as possible from people who don't carefully save before the collapse. Mark our words: US 401ks and IRAs will be nationalized in the next four years as well—maybe as soon as the next one or two years.
If you've stayed in tune with the Dollar Vigilante blog, you probably already understood this. If you haven't already, be sure to check into our subscription services to gain access to the intelligence you need to stay ahead of the pack.
Anarcho-Capitalist. Libertarian. Freedom fighter against mankind’s two biggest enemies, the State and the Central Banks. Jeff Berwick is the founder of The Dollar Vigilante, CEO of TDV Media & Services and host of the popular video podcast, Anarchast. Jeff is a prominent speaker at many of the world’s freedom, investment and gold conferences as well as regularly in the media including CNBC, CNN and Fox Business.
While the developed world is focusing on the rapidly deteriorating developments in the Crimean, China, which has kept a very low profile on the Ukraine situation aside from the token diplomatic statement, is taking advantage of this latest distraction to do what it does best: quietly take over the global periphery while nobody is looking.
Over two years ago we reported that none other than Zimbabwe - best known in recent history for banknotes with many zeros in them - was bashing the US currency, and had alligned itself with the Chinese Yuan. This culminated last month with the announcement by Zimbabwe’s central bank that it would accept the Chinese yuan and three other Asian currencies as legal tender as economic relations have improved in recent years. "Trade and investment ties between Zimbabwe, China, India, Japan and Australia have grown appreciably," said Charity Dhliwayo, acting governor of the Reserve Bank of Zimbabwe.
Exporters and the public can now open accounts in yuans, Australian dollars, Indian rupees and Japanese yen, Dhliwayo said. Zimbabwe abandoned its worthless currency in 2009.
It accepts the US dollar and the South African rand as the main legal tender. Their use has helped to stabilise the economy after world-record inflation threw it into a tailspin.
Independent economist Chris Mugaga said the introduction of the Asian currencies would not make a huge difference to Zimbabwe’s struggling economy.
"It is Zimbabwe’s Look East Policy, which has forced this, and nothing else," he said.
And now, as a result of the "Look East Policy", we learn that China has just achieved what every ascendent superpower in preparation for "gunboat diplomacy" mode needs: a key strategic airforce base. From the Zimbabwean.
China is planning to set up a modern high-tech military base in the diamond-rich Marange fields, says a German-based website, Telescope News.
The news of the agreement to set up the first Chinese military airbase in Africa comes amid increasing bilateral cooperation between Zimbabwe and China – notably in mining, agriculture and preferential trade. China is the only country exempted from the indigenisation laws which force all foreign investors to cede 51% of their shareholding to carefully selected indigenous Zimbabweans.
The airstrip at Marange has sophisticated radar
systems and ultra-modern facilities
The Marange story quoted unnamed military officials and a diplomat admitting knowledge of the plan to set up the base. Efforts to get a comment from the Zimbabwe Defence Forces were fruitless, as spokesperson Lt Col Alphios Makotore was consistently unavailable and did not respond to emails by the time of going to press.
The website speculated that China could be positioning itself for future “gunboat diplomacy” where its military presence would give it bargaining power against superpowers like the US. It would also be safeguarding its significant economic interests in Zimbabwe and the rest of Africa.
Veil of secrecy
“Military officials in Zimbabwe said details of the airbase plan were sketchy and mostly classified due to the veil of secrecy around President Robert Mugabe’s relationship with China’s Red Army. A sizeable number of Chinese troops are reported to have their boots on the ground in the Marange diamond fields, which have since been cordoned off as a high level security zone,” said the publication.
It added that a senior Air Force of Zimbabwe (AFZ) officer based in Harare confirmed that there were rumours of the impending establishment of the airstrip as a “follow up to a military treaty signed between China and Zimbabwe in July 2005”.
Telescope News has made sensational claims in recent weeks, among them that Defence Minister and Zanu (PF) Secretary for Legal Affairs, Emmerson Mnangagwa, was secretly anointed by the military to succeed President Robert Mugabe.
It quoted a former Asian diplomat deployed to Zimbabwe for almost a decade as saying: “Haven’t you heard that Africa is the battlefield of tomorrow, today? As such in terms of geo-politics Zimbabwe is already a key battleground, for various competing powers. During my stay there, we heard about many military agreements being signed between the two countries.”
Chinese companies are heavily involved in diamond mining, in partnership with the Zimbabwe Government. They are believed to have constructed the airstrip at Marange that many suspect is being used to clandestinely haul diamonds to unknown destinations. It has sophisticated radar systems and ultra-modern facilities.
At this point expect to see a prompt, and unexpected, escalation in hostilities in southern Africa, most likely due to latent ethnic conflict of some kind (and brought back to the surface with the help of a few CIA dollars), which in turn will be the justification for US drones to begin operations in proximity to Zimbabwe to keep up with China's encroaching take over of Africa, now from the south.
Perhaps most interesting is the finding that Zimbabwe's president-cum-dictator, Robert Mugabe, so widely despised by the west, is in fact on China's payroll:
Confidential Central Intelligence Organisation documents leaked last year suggested that China had played a central role in retaining President Robert Mugabe in the July 31 elections, indicating that high level military officers had worked closely with the local army in poll strategies while Beijing bankrolled Zanu (PF).
China is Zimbabwe’s biggest trading partner after South Africa and has strategic economic interests in many African countries to guarantee raw materials, job sources and markets for its huge population.
The new Chinese Ambassador to Zimbabwe, Lin Lin, recently said trade between the two countries last year exceeded the $1 billion mark. Yet Zimbabwe is only 26th on the list of China’s 58 biggest African trading partners.
The Asian country has supplied Zimbabwe with military hardware, including MIG jet fighters, tanks, armoured vehicles and rifles, since Independence.
In other words, while nobody was looking, China just took over one more nation without spilling a drop of blood. And now back to the regularly scheduled Crimean War part X.
This supporter of the Ukraine joining the EU has received her reward: a 50% cut in her pension.
According to a report in Kommersant-Ukraine, the finance ministry of Washington’s stooges in Kiev who are pretending to be a government has prepared an economic austerity plan that will cut Ukrainian pensions from $160 to $80 so that Western bankers who lent money to Ukraine can be repaid at the expense of Ukraine’s poor. http://www.kommersant.ua/doc/2424454 It is Greece all over again.
Before anything approaching stability and legitimacy has been obtained for the puppet government put in power by the Washington orchestrated coup against the legitimate, elected Ukraine government, the Western looters are already at work. Naive protesters who believed the propaganda that EU membership offered a better life are due to lose half of their pension by April. But this is only the beginning.
The corrupt Western media describes loans as “aid.” However, the 11 billion euros that the EU is offering Kiev is not aid. It is a loan. Moreover, it comes with many strings, including Kiev’s acceptance of an IMF austerity plan.
Remember now, gullible Ukrainians participated in the protests that were used to overthrow their elected government, because they believed the lies told to them by Washington-financed NGOs that once they joined the EU they would have streets paved with gold. Instead they are getting cuts in their pensions and an IMF austerity plan.
The austerity plan will cut social services, funds for education, layoff government workers, devalue the currency, thus raising the prices of imports which include Russian gas, thus electricity, and open Ukrainian assets to takeover by Western corporations.
Ukraine’s agriculture lands will pass into the hands of American agribusiness.
One part of the Washington/EU plan for Ukraine, or that part of Ukraine that doesn’t defect to Russia, has succeeded. What remains of the country will be thoroughly looted by the West.
The other part hasn’t worked as well. Washington’s Ukrainian stooges lost control of the protests to organized and armed ultra-nationalists. These groups, whose roots go back to those who fought for Hitler during World War 2, engaged in words and deeds that sent southern and eastern Ukraine clamoring to be returned to Russia where they resided prior to the 1950s when the Soviet communist party stuck them into Ukraine.
At this time of writing it looks like Crimea has seceded from Ukraine. Washington and its NATO puppets can do nothing but bluster and threaten sanctions. The White House Fool has demonstrated the impotence of the “US sole superpower” by issuing sanctions against unknown persons, whoever they are, responsible for returning Crimea to Russia, where it existed for about 200 years before, according to Solzhenitsyn, a drunk Khrushchev of Ukrainian ethnicity moved southern and eastern Russian provinces into Ukraine. Having observed the events in western Ukraine, those Russian provinces want to go back home where they belong, just as South Ossetia wanted nothing to do with Georgia.
Washington’s stooges in Kiev can do nothing about Crimea except bluster. Under the Russian-Ukraine agreement, Russia is permitted 25,000 troops in Crimea. The US/EU media’s deploring of a “Russian invasion of 16,000 troops” is either total ignorance or complicity in Washington’s lies. Obviously, the US/EU media is corrupt. Only a fool would rely on their reports. Any media that would believe anything Washington says after George W. Bush and Dick Cheney sent Secretary of State Colin Powell to the UN to peddle the regime’s lies about “Iraqi weapons of mass destruction,” which the weapons inspectors had told the White House did not exist, is clearly a collection of bought-and-paid for whores.
In the former Russian provinces of eastern Ukraine, Putin’s low-key approach to the strategic threat that Washington has brought to Russia has given Washington a chance to hold on to a major industrial complex that serves the Russian economy and military. The people themselves in eastern Ukraine are in the streets demanding separation from the unelected government that Washington’s coup has imposed in Kiev. Washington, realizing that its incompetence has lost Crimea, had its Kiev stooges appoint Ukrainian oligarchs, against whom the Maiden protests were partly directed, to governing positions in eastern Ukraine cities. These oligarchs have their own private militias in addition to the police and any Ukrainian military units that are still functioning. The leaders of the protesting Russians are being arrested and disappeared. Washington and its EU puppets, who proclaim their support for self-determination, are only for self-determination when it can be orchestrated in their favor. Therefore, Washington is busy at work suppressing self-determination in eastern Ukraine.
This is a dilemma for Putin. His low-key approach has allowed Washington to seize the initiative in eastern Ukraine. The oligarchs Taruta and Kolomoyskiy have been put in power in Donetsk and Dnipropetrovsk, and are carrying out arrests of Russians and committing unspeakable crimes, but you will never hear of it from the US presstitutes. Washington’s strategy is to arrest and deep-six the leaders of the secessionists so that there no authorities to request Putin’s intervention.
If Putin has drones, he has the option of taking out Taruta and Kolomoyskiy. If Putin lets Washington retain the Russian provinces of eastern Ukraine, he will have demonstrated a weakness that Washington will exploit. Washington will exploit the weakness to the point that Washington forces Putin to war.
The war will be nuclear.
About Dr. Paul Craig Roberts
Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. His latest book, The Failure of Laissez Faire Capitalism and Economic Dissolution of the West is now available.
Here is another Article I would like to have included in this post as it may also show us something that helps to see beyond illusion...
Ukraine signs $10 billion shale gas deal with Chevron
(L-R, front) Chevron Exploration and Production Europe Derek Magness, Ukraine's Energy Minister Eduard Stavytsky, Chairman of the National Joint Stock Company ''Nadra Ukrayny'' Viktor Ponomarenko, (L-R, back) U.S. Ambassador Jeffrey Payette, Ukraine's President Viktor Yanukovich and President of Chevron Europe, Eurasia and Middle East Exploration and Production James Johnson attend a signing ceremony in Kiev, November 5, 2013.
Credit: Reuters/Mykhailo Markiv/Ukrainian Presidential Press Service/Handout via Reuters
(Reuters) - Ukraine signed a $10 billion shale gas production-sharing agreement with U.S. Chevron (CVX.N) on Tuesday, another step in a drive for more energy independence from Russia.
The deal to develop its western Olesska field followed a similar shale gas agreement with Royal Dutch Shell (RDSa.L) in January and boosts Ukraine's leadership at a time of fraught relations with Moscow over gas supplies.
"The agreements with Shell and Chevron ... will enable us to have full sufficiency in gas by 2020 and, under an optimistic scenario, even enable us to export energy," President Viktor Yanukovich told investors shortly before the signing.
The highest end of expectations for Olesska's potential reserves would match around three years of European Union gas demand, but similarly sunny hopes for shale reserves in neighboring Poland have been very sharply downsized.
Shale development in Europe is far behind the booming U.S. sector and progress is patchy. Chevron pulled out of a shale exploration tender in Lithuania and has suspended work at a Romanian shale well after local protests.
Ukraine Energy Minister Eduart Stavytsky, who signed the deal with Chevron executive Derek Magness, set it in the context of a high price Ukraine pays Russia for its gas.
"This is one more step towards achieving full energy independence for the state. This will bring cheaper gas prices and the sort of just prices which exist (elsewhere) in the world," he said.
Ukraine pays $400 per thousand cubic meters for Russian gas under a 2009 10-year agreement. Kiev has failed to re-negotiate its terms with Moscow.
The agreement with Chevron, to extend for 50 years, foresaw an initial investment of $350 million by the U.S. major in exploratory work over two or three years, Stavytsky said, aimed at establishing the commercial viability of shale reserves in the 5,260 square km (2,000 square miles) Olesska, part of a band of shale which stretches from the Baltic to the Black Sea.
Earlier government figures set total investments, including extraction after exploratory drilling, at around $10 billion.
FRICTION WITH RUSSIA
Stavytsky said the Ukrainian side hoped that exploratory work would yield more detailed information about reserves at Olesska in 2015.
It was expected that Olesska would produce 5 billion cubic meters per year - and possibly as much as 8-10 billion cubic meters, he said.
The deal with Shell, which is at a similar level of investment, is for exploration at Yuzivska in eastern Ukraine.
The two shale projects could provide Ukraine with an additional 11 to 16 billion cubic meters (bcm) of gas in five years' time, according to projections by the Kiev government.
With Ukraine also a transit route for Russian gas to Europe, rows in the past which have led to disruption for European consumers.
The two sides clashed over prices in the winters of 2006 and 2009, with Moscow halting deliveries not only to Ukraine but to the rest of Europe.
With Russia angered over Ukraine's plans to sign a landmark agreement with the European Union which will mark a shift away from Russia's sphere of influence, the issue has flared again.
Late last month, Russia's gas export monopoly Gazprom (GAZP.MM) demanded Ukraine pay a $882 million overdue gas bill urgently.
Stavytsky said on Tuesday that Ukraine had already begun to settle the outstanding bill but gave no details.
Gazprom spokesman Sergei Kupriyanov said his company had recently received $9 million in payments from Naftogaz Ukraine. "It's just a drop in the ocean," he said.
Russian Prime Minister Dmitry Medvedev has since said he sees no reason for Moscow to cut gas supplies to Ukraine over the unpaid bill for now and has played down talk of an imminent "gas war" that might disrupt flows to Europe.
(Additional reporting by Denis Pinchuk in Moscow; Editing by William Hardy)